IN RETIREMENT

Generate retirement income

You've worked hard toward a comfortable and meaningful retirement. Following some simple guidelines may help to make your retirement income last.
1

Know how you'll generate retirement income

Take a strategic approach to drawing income from your nest egg and look for ways to minimize taxes. Many retirees also choose to work part-time. This additional income can make a difference in stretching your funds.
Read:
4 ways to help boost your retirement income
 
Develop a retirement income strategy
2

Create a retirement budget

You could live 20 to 30 years in retirement, so budgeting has never been more important. Be especially mindful of medical expenses. Paying for Medicare supplemental insurance out of your own pocket can really add up.
Read:
Managing cash flow in retirement
 
Plan for and manage health care costs
 
Create a retirement budget
3

When to claim your Social Security benefit

Social Security is an important part of your retirement strategy. Research and consider the most advantageous time to take your benefit. The longer you wait, the more you'll get.1
Read:
Develop a retirement income strategy
 
Develop a Social Security & retirement date strategy
4

Understand required minimum distributions (RMDs)

Once you reach age 73*, the IRS requires you to withdraw a minimum amount each year from certain IRAs. That amount is called a required minimum distribution, or RMD.

There may be a 25% additional federal tax for missed or insufficient RMDs, so it pays to do a little research and get your RMDs right.

*The required beginning date for RMDs is age 73 You may defer your first RMD until April 1st in the year after you turn age 73, but then you'd be required to take two distributions in that year. Failure to take all or part of an RMD may result in up to a 25% additional tax applicable to the amount of the RMD not withdrawn. Consult your tax advisor for more information on your personal circumstances.
5

Consider rolling over old 401(k)s

Consolidating your retirement assets into one easy-to-manage account is simple with a Rollover IRA. Consider all of your choices and learn if a Rollover IRA may be right for you.2
Learn more:
Rolling over a 401(k)
Read:
How much do you really need to save for retirement?

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2 You have choices about what to do with your 401(k) or other type of plan-sponsored accounts. Depending on your financial circumstances, needs and goals, you may choose to roll over to an IRA or convert to a Roth IRA, roll over a 401(k) from a prior employer to a 401(k) at your new employer, take a distribution, or leave the account where it is. Each choice may offer different investments and services, fees and expenses, withdrawal options, required minimum distributions, tax treatment (particularly with reference to employer stock), and provide different protection from creditors and legal judgments. These are complex choices and should be considered with care. For more information visit our rollover page or call Merrill at 888.637.3343.

Important disclosures

1 This material should be regarded as general information on Social Security considerations and is not intended to provide specific Social Security advice. If you have questions regarding your particular situation, please contact your legal or tax advisor.
Footnote
Merrill, its affiliates, and financial advisors do not provide legal, tax, or accounting advice. You should consult your legal and/or tax advisors before making any financial decisions.
A direct rollover occurs when you request that a rollover check be made payable directly to the new custodian for the benefit of your individual retirement account (IRA) or employer-sponsored retirement plan. A direct rollover is not subject to current tax or penalties.
An indirect rollover occurs when you request that a rollover check be made payable to you, after which you deposit the money into your IRA or another employer's retirement plan within 60 days. When such a distribution is made by the plan, the plan is required by law to withhold 20% of the taxable amount for prepayment of federal income taxes. If you wish to rollover the entire distribution, you must make up the 20% withholding out of your own funds, or you will be subject to income taxes and possibly early withdrawal penalties on the shortfall. If you fail to complete the rollover within 60 days, all or part of the money distributed to you will be taxable and a 10% additional tax for early withdrawals may apply.
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